The Department of Posts, Fino Paytech, Tech Mahindra and National Securities Depository Ltd also made the cut.

Of the 41 entities that applied for a licence, the prominent names that did not make it in this round include Future Group Founder Kishore Biyani, Videocon d2h and MG George Muthoot.

Payments banks differ from conventional banks as they are not allowed to lend to customers or issue credit cards. They can, however, accept deposits of up to ₹1 lakh and can offer current and savings account deposits. They can also issue debit cards and offer internet banking.

Rollout plan

While the 11 companies have been given 18 months to comply with all the conditions laid out by the RBI, most of them have already put in place a robust roll-out plan. Telecom operators with their vast retail presence would be the first off the block.

Sunil Sood, Managing Director & CEO, Vodafone India, said, “The payment bank licence will enable us to offer a more comprehensive portfolio of banking and financial products and services, accelerating India’s journey into a cashless economy.” Norwegian telecom company Telenor announced that it was partnering Dilip Shanghvi along with IDFC.

Reliance Industries and Aditya Birla Nuovo will ride on their respective telecom ventures Reliance Jio and Idea Cellular. They would also leverage their existing businesses in retail and financial services to quickly roll out payment bank services.

For entities like Paytm, Fino PayTech and Cholamandalam, this is a natural progression of what they are already doing.

Vijay Shekhar Sharma, founder and CEO of Paytm, said: “It is truly a privilege to be one of the youngest ones in this lot of 11. We believe that led by mobile and data analytics technology, we will be able to change the face of financial inclusion opportunity in India. It is about bringing half a billion Indians to the main stream of economy.”

Vellayan Subbiah, MD, Cholamandalam Investment and Finance, said, “This is a transformative step in fulfilling the financial inclusion goal of the government and the RBI. We currently have over 534 branches spread across the country and a captive base of over 7.5 lakh customers, which is an immediate opportunity that can be tapped into.”

“I am very happy to learn that the Postal Department has been given a payment banking permission. I have been trying since I became the Minister to energise and make the vast network of Postal Department for financial digital inclusion and e-commerce activity. I would expect the Postal Department to prepare itself properly and effectively for this,” said Telecommunications and IT Minister Ravi Shankar Prasad.